Today (Jun 12), the market for oilseeds and oils in China is shown as follows:

Oilseeds:

Imported soybean: Only a very few traders have the supply PNW soybeans at ports, which bolsters the prices there. However, downstream customers now lack of enthusiasm and stay on the sidelines, so that there is only rigid demand in the market and port shipments are not at a quick pace. Moreover, port Brazilian soybeans are of high stocks and relatively weakening spot prices. In addition, soybean vessels from Argentina and Uruguay are to arrive at ports later this month, which can replace PNW soybeans. And China is still purchasing US soybeans. Hence, soybean supply will further increase at ports. In a hybrid of the bull and the bear, short-term soybean market is predicted to trade at a narrow range.

Cottonseed: Cottonseed prices steadily increase by 0.02-0.03 CNY/kg in individual regions today. The supply of cottonseed is decreasing and tightening, so traders are reluctant to sell them. Besides, it is hard to reduce the freight from Xinjiang to inland due to lack of vehicles. Consequently, cottonseed price is boosted by these factors. But crushing plants reduce the operation rate on account of wheat harvest and profit losses, so there are not many new orders, seeing light trading. Therefore, the price of gross cottonseed delivered from Xinjiang to inland factories will likely fluctuate to stay strong in a short term.

Oils:

Summary: U.S. soybean futures closed marginally higher, as the USDA slightly trimmed its estimates for new soybean stocks in a monthly supply and demand report. But stocks fell sharply on Wall Street Thursday as the selling came on concerns over a second wave of the COVID-19 outbreak in the United States. The Dow Jones sank over 1800 points, its worst day for 12 weeks, and crude oil slumped by 8.23%. These factors, along with the soybean oil sell-off in the market, weigh down oil futures to tumble on the Dalian Commodity Exchange today. In the spot markets, soybean oil and palm oil decline by 50-100 CNY/tonne in tepid trading, possibly attracting some low-level purchases on low forward basis. In consideration the bullish reports by the MPOB and the USDA, the decline in domestic oil market is really a surprise. This can be mainly attributed to the profit-taking and the influence of the collapse in U.S. stock markets and in crude oil prices. Meanwhile, China’s monthly soybean imports are forecast to top 10 mln tonnes between June and August, and weekly soybean crush will exceed 2 mln tonnes for weeks, which are also bearish to the market. However, June palm oil export data are strong in the producing countries, And for Chinese buyers, palm oil is not lucrative at the moment, so domestic palm oil stocks also remain at a low level. And domestic soybean oil stocks are only around 950,000 tonnes, so most oil mills are not under pressure. And premiums for Brazilian soybeans keep rising due to tight supplies, so that China’s cost of importing soybeans also jumps. These will help cap the declines in the oil prices. Overall, the oil market is in the correction territory after consecutive rises, and buyers can wait for low and stable prices to make appropriate replenishment.

Soybean oil: GB Grade I soybean oil is mainly priced at 5690-5820 CNY/tonne in domestic coastal areas, down 50-100 CNY/tonne. (Tianjin traders 5720; Rizhao traders 5690; Zhangjiagang traders 5820; and Guangzhou traders 5820).

Palm oil: RBD palm olein is mainly priced at 5230-5340 CNY/tonne in coastal areas, down 50-80 CNY/tonne. (Tianjin traders 5300-5320, down 50; Rizhao traders 5340, down 80; Zhangjiagang traders 5270, down 60; Guangzhou traders 5230-5250, down 80; and Xiamen 5400, down 80).

Rapeseed oil: U.S. soybean futures settled marginally higher on Thursday due to a relatively bullish report by the USDA, but rapeseed oil futures Exchange slow down rises to stay below the previous close on the Zhengzhou Commodity today. Spot rapeseed oil prices go down 20 CNY/tonne to 7630-7750 CNY/tonne in thin trading. Malaysia’s palm oil output might increase by about 30% month on month in the first half of June, and India is considering to raising edible oil import taxes. And China’s monthly soybean arrivals at ports are expected to surpass an average of 10 mln tonnes between June and August, and its weekly soybean crush has been at a very high level; hence, soybean oil stocks will keep accumulating. In addition, U.S. stock markets and crude oil both slumped on concerns over a second wave of the COVID-19 outbreak in the U.S.. Therefore, oils markets broadly follow to decline. But tensions are sourcing between China and Canada as well as the United States, and China’s consumption has recovered at a brisker pace than the forecast, which underpin rapeseed oil market. Overall, short-term rapeseed oil market is predicted to fluctuate at the high level, and buyers can wait for the moment.

Cottonseed oil: Cottonseed oil prices keep steady today. The cost remains too high, boosting cottonseed oil market. However, seeing over 10 mln tonnes of soybean arrivals each month from June to August, weekly soybean crush is projected to top 2 mln tonnes. Additionally, market’s risk aversion was heightened over the fears of second U.S. coronavirus wave, leading to a surprising crash in U.S. stocks. The Dow Jones index set its most falls of over 1800 over the past 12 weeks, and crude oil plunged 8.23%. Besides, traders bought soybean meal and sold soybean oil for an arbitrage. As a result, oils on Dalian Commodity Exchange showed a marked decline today, and soybean oil and palm oil down by 50-100 CNY/tonne on the spot market. These all raised market concerns over the bear news and affected buyers’ enthusiasm in purchasing. And there were only few new orders of cottonseed oil. As bulk oils pared gains in the near term, cottonseed oil market would likely stop rising and start fluctuating.

(USD $1=CNY ￥7.10)